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UK hospitality businesses face uncertain future without winter energy support

Hospitality trade advocate UKHospitality has warned of mass job losses and long-term damage to high streets if hospitality businesses in the UK are not supported amid soaring energy costs

A June 2022 survey indicated that energy costs were the biggest factor behind dwindling finances in the industry | Photo credit: StockSnap


UKHospitality has urged the UK government to introduce a comprehensive package of measures until the end of March 2023 to support hospitality businesses in the country withstand rising energy bills. 

In a letter to Chancellor Nadhim Zahawi and Business Secretary Kwasi Kwarteng, the London-based trade body suggested ministers consider a business rates holiday for all hospitality premises, with no caps applied, deferral of all environmental levies, the reinstatement of a tax payment installment scheme and the reintroduction of a trade credit insurance scheme for energy. 

A June 2022 survey of approximately 600 hospitality business leaders in the UK indicated that energy costs were the biggest factor behind dwindling finances in the industry. The research, co-produced by UKHospitality, warned that only 37% of British hospitality businesses are currently turning a profit. 

In August 2022, Sacha Lord, the night-time economy adviser for Greater Manchester, warned that the UK’s hospitality industry is in deeper trouble now than during the pandemic as it faces rising inflation and increased energy costs. He also stressed the need for a temporary reduction in VAT on business energy bills from 20% to 5%. 

“Support has rightly been committed to households, but more must be done to help businesses, particularly SMEs, that are at risk of failure due to no fault of their own. Hospitality businesses had their resilience severely strained during the pandemic and are not able to weather the worsening storm they now face. Immediate intervention in the commercial energy market is essential to avoid dire consequences,” said Kate Nicholls, CEO, UKHospitality. 

UKHospitality represents more than 700 hospitality companies in the UK which collectively operate approximately 85,000 venues. 

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